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Chairwoman Stabenow Floor Remarks on Agriculture Reform, Food and Jobs Act of 2012

Senator Debbie Stabenow, Chairwoman of the U.S. Senate Committee on Agriculture, Nutrition and Forestry, today delivered the below remarks on the Senate floor, discussing the Agriculture Reform, Food and Jobs Act of 2012 – which passed Committee with a strong bipartisan vote (16-5) and is now being considered by the full Senate.


Floor Statement of Chairwoman Debbie Stabenow

Committee on Agriculture, Nutrition and Forestry

Consideration of S.3240, the Agriculture Reform, Food and Jobs Act of 2012

As Prepared for Delivery

Mr. President, before us today is the Agriculture Reform, Food and Jobs Act of 2012. It’s more commonly known as the “Farm Bill,” and it is critically important for America’s farmers. But it might as well be known as the “Conservation Bill” or the “Food Bill” or even better, the “Kitchen Table Bill,” because this bill affects every one of us.

The Agriculture Committee is different from most of the other Committees in Congress. Our committee room doesn’t have a raised dais – instead we sit around a table just like families across the country do, and just like farmers and ranchers do after a long day of work in the fields.

And so to write this Farm Bill, we sat down around our table, and we talked to each other, and we listened to each other, and we worked in a bipartisan way to craft a bill that creates jobs while cutting subsidies and reducing the deficit. The result of that effort is the bill we have before us today.

It’s a bill that affects every family across the country. The Farm Bill makes it possible for many families to come together around their own kitchen tables to enjoy the bounty of the world’s safest, most abundant and most affordable food supply.

And so we are also aware, especially in this very tough economy, that many of our neighbors, many of our friends, and many of our family members are struggling to put food on their tables. And the Farm Bill is critically important for those families as well.

So as we begin our debate here in the Senate on the Farm Bill, let us remember the families all across the country who are counting on us to get this right.

I want my colleagues to also remember that this Farm Bill is a Jobs Bill. 16 million jobs in this country rely on the continued strength of American agriculture.

They are the people doing the work it takes to put that food on our kitchen tables – not just those on the farm, but those who manufacture and sell farm equipment, the people who ship the crops from one place to another, the people who have the farmers markets and local food hubs, the people who work in food processing and crop protection and crop fertility, not to mention the researchers and scientists who work hard every day to fight pests and diseases that threaten our food supply.

And throughout this recession, as those 16 million people can attest, agriculture has been one of the truly bright spots in our economy.

That’s why we made such an effort in this Farm Bill to support beginning farmers and ranchers. We are giving them additional support for training, mentoring, and outreach to ensure the success of our next generation of farmers. In addition, we’re giving opportunities to veterans who are interested in pursuing a career in agriculture, and we are creating a military veterans agricultural liaison within the Department of Agriculture to educate veterans about farming and connect them with beginning farmer training programs.

Over half of veterans in Iraq and Afghanistan are coming from small towns in rural America.

One of the brightest spots in agriculture has been in exports. This chart shows the incredible, exponential growth of agricultural exports over the years. In 2011, total agricultural exports reached $136 billion, a 270 percent increase from 2000. Our trade surplus was $42.5 billion.

Let me repeat that: we have a significant trade surplus in agriculture – one of the few areas of our economy where we have that kind of success. We know that every $1 billion in agricultural exports represents 8,400 American jobs, and so the investments we make in market development and access for our agricultural products overseas will continue creating jobs here at home.

As we were writing this Farm Bill, we also did something else that families all across the country are doing during these hard times – we went through everything we were spending money on, we literally went through every page, and we looked at how we could do more with less. This bill represents major reform that will help us focus fewer resources on the things that create jobs and make the biggest difference.

The Agriculture Reform, Food and Jobs Act is about cutting subsidies and creating jobs in America. The reforms in this bill start on page 1 with the repeal of direct payments, Counter-Cyclical Payments, and the Average Crop Revenue Election (ACRE) Program.

We are creating a new approach that only helps farmers when there is a loss, and only for crops they have actually planted.

We are strengthening payment limits.

We are ending more than 100 programs and authorizations that are no longer needed.

And by doing all of this, we were able to cut the deficit by $23 billion.

The most fundamental reform in the Agriculture Reform, Food and Jobs Act is the shift away from direct payments and toward risk management for farmers. Throughout this process, we have been focused on principles, not programs – and the number one principle has always been risk management.

We know that farmers face unique risks unlike those in other businesses. Weather and market conditions outside a producer’s control can have devastating effects. But the current system, focused around direct and counter-cyclical payments, does not focus on actual risks and is no longer defensible or sustainable.  In this current fiscal and political environment, these programs actually jeopardize our ability to have a real safety net for farmers and the jobs that depend on them.

That is why we are eliminating those programs and instead strengthening crop insurance as the centerpiece of risk-management in the Farm Bill. This is the number one issue we heard about from every farmer who testified before our committee, in every region of the country.

We are expanding crop insurance in this bill to include specialty crops – essentially the kinds of crops you’re likely to find in the produce aisle of your supermarket or at your local farmers market: fruits, vegetables, nuts, and other products. This is an extremely diverse group of crops, and this bill recognizes the unique crop insurance needs of specialty crop growers.

We are also taking strides to help young and beginning farmers get started and succeed in farming. We made revisions to crop insurance to better help those new farmers by reducing their crop insurance premiums and providing additional support when disasters strike.

To supplement crop insurance, this bill creates a single, simple, market-oriented and risk-based program called ARC – Agriculture Risk Coverage. ARC represents significant and historic reform in agriculture policy. For years, Congress has struggled to balance the needs of different commodities and programs. This is solved with ARC, which uses the market as a guide, and treats every commodity the same.

The current system essentially amounts to an income transfer from the federal treasury to only certain people, because payments are made every year without regard to whether the farmer had a successful year or not, or whether the individual is even farming or not. I say certain people because many farmers do not even qualify for help. Direct and counter-cyclical payments are made using what are called “base acres” to determine the payments.  Base acres were set using what was planted on the farms back in the 1980’s, so these base acres have little relevance to what is actually happening on many farms today.

ARC, on the other hand, uses only the acres that a farmer actually plants, so it is able to adapt to free market forces and the decisions being made on the farm, without interfering with those business decisions that a farmer needs to make.

We want the farmer and the market to make decisions – not the government.

ARC is market-oriented: farmers only get help when the market moves in the opposite direction from historic price trends farmers use to plan their businesses and make planting decisions. The payment amount is based on actual, historic numbers from the marketplace – not from the halls of Congress.

Finally, too many current program payments are being made to people who do not actually farm, or who have very large incomes already.

This Farm Bill fixes these problems.

First, under current law, we say that farm payments can only go to people who are “actively engaged in farming.” This requirement contains a loophole though, known as the “management loophole,” that lets a farm operation designate “managers” who are not actually farming. But because they are listed as “managers” they can get a payment from the government, and it can allow them get around payment limits. That doesn’t make sense, and thanks to Senator Grassley, we eliminated that loophole and made sure that payments are going to people who are actually farming.

This Farm Bill also reforms the Adjusted Gross Income eligibility requirement and lowers it substantially, eliminating payments to millionaires.  Current law includes two AGI calculations, one for farm income and one for nonfarm income, which is confusing and difficult to administer, and it may allow some people to split their income to remain eligible for payments.  We close this loophole and use a single, simple AGI calculation and restrict eligibility to those who have less than $750,000 in AGI.  Finally, the farm bill caps payments at $50,000 – less than half of what a farmer can currently receive.  Coupled with closing the management loophole, this farm bill contains the tightest and strongest payment limit reforms ever – while maintaining and strengthening a farm safety net for those who really need it.

We also reform our nation’s dairy policies, replacing the dairy programs with new, market-oriented programs that allow farmers to manage their own risk in the manner that works best for them. The dairy industry suffered serious hardship in 2009 when milk prices dropped substantially, wiping out many small and medium-sized dairies. Despite spending $1.3 billion that year, our current dairy programs were unable to help all of our farmers though the crisis. In some cases, dairy farms that had been passed down from generation to generation went bankrupt, and some farmers even took their own lives.

Dairy operations across the country are extremely diverse, and the dairy policies we are setting in the Agriculture Reform, Food and Jobs Act recognize that diversity. We created programs that can be customized by each dairy, and we allowed individual dairies to determine whether or not to participate in the programs altogether. Two programs will now comprise the dairy risk management system: the Dairy Production Margin Protection Program and the Dairy Market Stabilization Program.

The first provides support based on margin – that is, the difference between the milk price and the feed input costs. This is important because rising grain prices, coupled with dropping milk prices, can have a devastating impact on America’s dairies.

Producers will have to share in the program’s costs, but it will allow them to manage risk on more of their production at higher protection levels. We are providing a discounted premium for the first 4 million pounds of milk marketed by each producer – that’s equivalent to about 200 to 250 cows – to make sure that small and medium sized operations would be able to participate and that all farms would be eligible.

The second program, the market stabilization program, sends clear market signals to producers that indicate when they are oversupplying the market. Dairy is a unique commodity in that it is produced 365 days a year, cows must be milked daily, the raw product requires further handling and processing, and there are significant regional differences in management and marketing. By temporarily reducing a participating operation’s payment for milk marketed by a small percentage when there is too much supply, the margin program removes the incentive for dairies to overproduce during times of low margins. The program also includes a suspension trigger based on world prices that ensures U.S. dairies are competitive on the global market.

Throughout this Farm Bill, we took the same approach as a family sitting around the table would when trying to make cuts to their own budget: we went through every program, looked at what was working and what wasn’t, looked for duplication and waste, and focused on principles, not programs.

An excellent example of that approach is what we did with conservation.

Farming is measured in generations. Farms are passed down to children and grandchildren – but a farm can only be successful if it has quality soil and clean water. One of the farmers who testified before our Committee told us that conservation programs, which “enhance and protect our natural resource base, is a crop insurance for the nation.”

With a growing global population, it is more important than ever that we conserve our soil and water resources. Advances in technology and farm practices have helped our farmers be more productive than ever before, but no amount of technology can overcome degraded soils, poor water quality, or a lack of water.

The Farm Bill is actually our nation’s single biggest investment in land and water conservation on private lands. As we went through each program, we focused on making them more flexible and easier to use. We have been able to focus 23 different conservation programs into 13 programs in four primary functions.

The first function is working lands – giving farmers and ranchers the tools they need to be better stewards of the land. The Environmental Quality Incentives Program, or EQIP, is one of the most important conservation programs for working lands, providing technical and financial assistance to farmers, ranchers, and private forest owners to help them conserve soil and water. This function also includes the Conservation Stewardship Program, which encourages higher levels of conservation and the adoption of emerging conservation technologies. We also continued the Conservation Innovation Grants and the Voluntary Public Access and Habitat Incentive Program, which allows private landowners to get added benefits from their lands by opening them up to hunting, fishing, bird-watching, and other kinds of outdoor recreation. We made these programs more flexible, added a focus on wildlife habitats, and made them easier for farmers to take advantage of.

The second area, the Conservation Reserve Program, removes highly erodible land from production to benefit soil and water quality as well as wildlife habitats. Parts of the southwestern United States experienced record droughts last year. Some areas had well over 250 days without rain. That’s worse than during the Dust Bowl era of the 1930s. Soil was dry, but it stayed on the ground. CRP was a part of that – protecting our soil and our air. CRP has also been critical in our efforts to rebuild wildlife populations and to reduce pollution in our streams, rivers, and lakes. We also continued an important transition incentives program to help older farmers transition their land to beginning farmers.

Third, we focused on Regional Partnerships. We consolidated four different programs into one that will provide competitive, merit-based grants to regional partnerships composed of conservation groups, universities, farmers, ranchers and private landowners to support improvements to soil health, water quality and quantity, and wildlife habitats. This is certainly important to me for the Great Lakes, but also for the Chesapeake Bay and other critical areas around the country where there are large-scale, regional challenges around conservation.

Finally, I’m really proud of the work that was done around Easements. Easements allow landowners to voluntarily enter into an agreement to preserve wetlands and farmland to protect against development and sprawl. This year, funding for both the Wetlands Reserve Program and the Grasslands Reserve Program were zeroed out. So we streamlined and consolidated to establish an easement program with a permanent baseline to protect agricultural lands from development.

This bill also includes a bipartisan sodsaver provision authored by Senators Thune, Johanns, and Brown, to help prevent the plowing up of native prairie. Sodsaver is aimed at protecting grasslands at high risk of being converted to cropland. This is not only good for conservation, it saves taxpayers $200 million over 10 years and it’s tied to crop insurance.

The Conservation title of the Senate Farm Bill is a big win for conservation of our environment. I’m proud that we have received support for our approach from 643 conservation and environmental organizations in all 50 states, showing that it is possible to make smart cuts that increase flexibility without sacrificing effectiveness.

Another area where we have made significant strides is in nutrition and healthy foods. For too long, our nation’s Farm Bills ignored the diversity of agriculture and the kinds of healthy foods like fruits and vegetables that families in America want to put on their kitchen table. We made significant progress on this front in the 2008 Farm Bill with the first-ever Specialty Crops title. We continued that progress in the Agriculture Reform, Food and Jobs Act.

As I said earlier, everywhere I go in Michigan, I meet people who worked all their lives and never imagined they would be in a position where they need help putting food on the table. And when they need it, whether it is food assistance through the Supplemental Nutrition Assistance Program, which used to be called food stamps – or whether it is help at a food bank – those families are unbelievably grateful that help is in place.

We all expect those programs to have integrity – and as someone whose state has been hit harder than any other in this recession, I want to make absolutely sure those programs are in place for families that need them, and that means making absolutely sure that every dollar goes only to families in need.

That is why we are closing loopholes that allowed lottery winners to continue receiving food assistance. It is shameful that so many American children go to bed hungry every night, and it is absolutely outrageous that people who have won millions from the lottery were able to continue getting food assistance. So we made it absolutely clear that those individuals will be removed from SNAP immediately.

We are also cracking down on trafficking of food assistance benefits. Right now, thanks to the efforts from the last Farm Bill, fraud is at an all-time low. But we can do even better. We are giving additional resources to monitor and prevent benefit trafficking, as well as cracking down on liquor and tobacco stores that are currently allowed to participate in the program.

We are making sure that only people returning to school for career or technical training are eligible for food assistance, not just a college student who is getting support from their parents. Again, with so many families and so many children in need, we cannot afford to have funds diverted to those who do not truly need them.

We must also ensure that the standards Congress created for SNAP are followed by the States. We are eliminating a gap in standards that has allowed 16 states now to give just $1 dollar to people in the form of energy assistance to help them automatically qualify for additional SNAP benefits. We know that families in parts of the country with high energy bills are often those who are most food insecure, and that’s why we created the link between food assistance and the Low Income Home Energy Assistance Program, or LIHEAP.

But it is clear that Congress never intended for state governments to use this program in a way that could jeopardize this additional assistance for families with the highest utility bills.

Just like with commodity programs, we need to make sure the work we are doing has integrity and is defensible in our current budget climate, and we did this in a very careful way to make sure we did not inadvertently hurt families who truly do have significant energy costs.

In addition to increasing accountability, we are building on the success of programs that reduce hunger and improve access to healthy fruits and vegetables.

We increased assistance for food banks through The Emergency Food Assistance Program, or TEFAP. In 2010, more than 5 million people visited a food bank, and as we recover from this recession, it is absolutely critical that these organizations have food in stock to help those in need.

We are streamlining the Commodity Supplemental Food Program, CSFP, which provides food to low-income individuals, to focus solely on seniors. We’re moving women and children into the WIC program where they will be better served.

We are continuing the Fresh Fruits and Vegetables Program, which provides free, healthy snacks to schools with a high number of low-income students.

This bill triples our support for Farmers Markets and gives them resources to develop local infrastructure like food hubs.

We are continuing an effort to give low-income seniors access to healthy fruits and vegetables at farmers markets and roadside stands.

We are increasing funding for innovative projects like community garden programs and urban greenhouse initiatives, and protected funding for programs that improve people’s health.

We are creating a national pilot program modeled after Michigan’s successful “Double Up Food Bucks,” which gives families relying on SNAP the opportunity to buy more fruits and vegetables with their dollars.

We are also authorizing the Healthy Food Financing Initiative to offer loans and grants to help address the problem of food deserts in underserved communities.

And we increased funding for several organic programs, which by the way, is the fastest-growing segment of American agriculture. We increased support for organic research and extension, and we nearly doubled funding for the Organic cost-share program that helps farmers convert from conventional farming to organic farming.

The Farm Bill is a Jobs Bill, but it is also a Food Bill, and the 2012 Farm Bill goes a long way toward making sure every mom and dad can put healthy, nutritious food on the table for their children.

As we worked through this Farm Bill around our table in the Agriculture Committee, we focused on streamlining and consolidating programs to get the best possible results. We certainly see that in conservation, but we used that approach throughout the Farm Bill.

In farm credit and rural development, we are streamlining the existing laws, removing unused provisions and making the authorities more effective and the administration of these programs more efficient.

In our research title, we eliminated dozens of unused or indefensible authorizations, but continued the most important research components and functions, while streamlining operations, improving accountability in the use of federal research dollars and creating an innovative, new research foundation that matches private dollars and leverages federal research dollars to get more innovative food and agriculture research.

We funded important energy programs and invested in specialty crops and organic farming.  We consolidated existing authorities for pest and disease risks that specialty crop farmers struggle with, making the programs better and stretching federal funds.

We did all of this, while saving the federal taxpayer $23 billion.  And we did it around our table in a bipartisan fashion, working out differences and arriving at real solutions.

In the coming days, we will get to debate this Farm Bill further, and I will join my colleagues from the Committee in further explaining each aspect of this bill.  And we will continue to work with all of our colleagues to find solutions and to improve the bill so that our farm programs work better for all of our regions and all of our states.

While I will do everything I can to work out some of these issues with my colleagues, I want to stress the importance of the balance we have struck in our bipartisan effort, the reforms we have undertaken and the work we put in to make real reforms without hurting families and farmers who are so important to our economic recovery. 

I am proud of the work we have accomplished and of the way we saved the American taxpayers $23 billion through real reforms.  I encourage each of you to look closely at the work that has gone into this bill and find a way to support it and to send a message to all Americans that this Congress, this Senate can make tough, smart decisions that cut spending and invest in America, and that we can do it together.

And I couldn’t have done this without my friend and partner, Senator Roberts. This has been a long and difficult process. But there is nobody I would rather have sitting across that table from me as we worked on this bill.

Too many people look at Washington and only see dysfunction and partisanship and divisiveness. And yet, we in the Agriculture Committee found a way to come together for the good of the country and for the 16 million people who depend on agriculture for their livelihood. That couldn’t have happened without Senator Roberts’s leadership and support.

Thank you, Mr. President.